Taiwan Semiconductor Manufacturing Company Limited (TSMC), the world’s largest foundry (contract manufacturer of microchips), reported a stunning 60% surge in first-quarter net profit compared to the same period last year, outpacing consensus forecasts. This remarkable growth was fueled by a flood of advance orders from global tech giants, spurred by concerns over potential U.S. tariffs.
On Thursday, TSMC announced its financial results for the first quarter of this year. The company posted revenue of 839.25 billion TWD (approximately 26 billion USD) and a net profit of 361.56 billion TWD (approximately 11 billion USD). These figures represent year-over-year (YoY) increases of 41.6% in revenue and 60.3% in net profit.
Notably, the net profit exceeded analysts’ consensus estimate of 354.6 billion TWD (approximately 11 billion USD) by 1.97%. Industry experts attribute this surge to a wave of pre-orders from around the world, triggered by the Trump administration’s April announcement of potential global tariffs. The company’s operating profit margin also improved, rising to 48.5% from 42.0% in the same quarter last year.
Breaking down shipments by process, 5-nanometer (nm·one-billionth of a meter, approximately two ten-millionth of an inch) chips led the pack at 36%, followed by 3nm at 22% and 7nm at 15%. Advanced technologies of 7nm and above accounted for a substantial 73% of total wafer revenue.
Looking ahead to this year’s second quarter (April-June), TSMC provided revenue guidance of 28.4 billion USD to 29.2 billion USD, surpassing market expectations of 27.2 billion USD. This projection suggests a robust 38% YoY increase. The company anticipates a gross profit margin between 57% and 59%, with an operating profit margin ranging from 47% to 49%.
Wendell Huang, TSMC’s Senior Vice President and Chief Financial Officer, said the company faced some challenges in the first quarter due to seasonal declines in smartphone demand, but noted that ongoing demand for artificial intelligence (AI) helped offset some of those risks. He added that TSMC expects strong demand for its 3nm and 5nm technologies to fuel business growth in the second quarter.